News

The government has approved a dedicated Rs 5,000 crore fund to bring more land area under micro-irrigation as part of its objective to boost agriculture production and farmers income

Particulars of the fund

The fund has been set up under NABARD

It will provide this amount to states on concessional rate of interest to promote micro-irrigation

An allocation of Rs2,000 crore has been made for this fiscal while Rs3,000 crore has been earmarked for the 2019-20 fiscal

NABARD will extend the loan to state governments during this periodMore about the fund

The dedicated fund would supplement the efforts of PMKSY programme and help bring about 10 lakh hectares under micro-irrigation

The fund will facilitate States to mobilise resources for their initiatives, including additional (top up subsidy) in implementation of PMKSY-PDMC to achieve the annual target of about 2 million hectares per year during the remaining period of 14th Finance Commission

Low interest rate

Borrowings from NABARD shall be paid back in seven years including the grace period of two years

The lending rate under MIF has been proposed at 3% lower than the cost of raising the fund by NABARD

This cost would be met from the ongoing scheme of PMKSY-PDMC (per drop more crop component) by amending the existing guidelines

Low coverage: Micro-Irrigation

It currently has a coverage of only 10 million hectares as against the potential of 70 million hectares